The GBP/USD has traded sideways during the last 24 hours. The rate has been waiting for additional technical support to be pushed down. On Thursday, the 55-hour simple moving average approached the rate.
This event caused a decline below the support of the 1.3030 level, which signalled a continuation of the fall of the GBP/USD.
The British Pound depreciated against the US Dollar, following the UK CPI data release on Wednesday at 8:30 GMT. The GBP/USD exchange currency rate lost 13 pips or 0.10% right after the release. The British Pound continued trading at the 1.3040 level against the US Dollar.
Office for National Statistics released the UK CPI data that came out worse-than-expected of 1.9% compared with the forecast of 2.0%.
According to experts, a change in the rate between February and March was caused by increased prices for motor fuels and clothing.
UK data during the mornings
This week's data releases will end on Thursday.At 08:30 GMT, the UK Retail Sales will be published.
Afterwards, the Canadian and US Retail Sales will be published at 12:30 GMT. Both data sets combined could cause a move on the USD/CAD of up to 30 pips.
Note that the US data is set to influence all USD currency exchange rates.
Meanwhile, check out previous data release covers and economic calendar analysis on the Dukascopy Webinars YouTube channel.
GBP/USD short term review
The support of a long term pattern drawn on the hourly chart was pierced on Thursday. The decline was caused by a spill over selling caused on the EUR/USD by the German PMI data that was published at 07:30 GMT.In general, the pair was expected to continue to decline down to the 1.3000 level, which will provide psychological support. Meanwhile, from a technical analysis perspective there is no support as low as 1.2978.
On the other hand, the rate might slightly recover and trade sideways above the pivot point at 1.3027.
Hourly Chart
On the daily chart the large scale ascending pattern was broken on Wednesday.
Note the resistance line, which managed to eventually force the currency exchange rate through the lower trend line of the large scale ascending pattern.
Meanwhile, on Thursday it could be noticed that a strong support cluster was forming near 1.2980. At that level the weekly S2 was about to be strengthened by the 100 and 200-day simple moving averages.
The 200-day SMA managed to stop the currency exchange rate from declining at the end of March and start of April. Daily chart
On Wednesday, the sentiment finally moved. 53% of total open position volume was long.
By the middle of Thursday's trading, the sentiment was 54% long.
Meanwhile, the pending orders in the 100-pip range from the rate were still neutral. 53% of the orders were set to sell. The rest of the orders were to buy.